Reliance Power gives 3 bonus shares for every 5
Reliance Power on Sunday announced it would offer non-promoter shareholders three bonus shares for every five held on the record date.
The move to issue the bonus is being projected as an attempt to compensate RelPower shareholders for losses suffered after the stock listed below the offer price on February 11.
Retail buyers were offered the stock at Rs 430 per share while others had the option to buy it at Rs 450. On Friday, five sessions after the announcement of the bonus proposal, the stock closed at Rs 417, still 7.3% off its IPO price of Rs 450.
After the bonus issue, the cost of holding each share will go down to Rs 269 for retail investors while for others, it will be Rs 281. This, the company said, would cut investors’ losses by 40%. However when Friday’s closing stock price is compared with the post-bonus price, the gain for retail shareholders is Rs 148 while for others it is Rs 190.